ACIT, V. M/s Abhay Enterprises,

ITA 34/RAN/2014

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 8567 (ITAT-RANCHI)
• Duration Of Justice: 9 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-11-2014
• Appeal Filed By: Department
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 28-01-2014
• Court: TRIBUNAL
• Department Lawyers: CHOUDHARY ORAM JCITLD
• Assessee Lawyers: S K PODDAR; M K CHOUDHARY LD ARS
• Keywords: Depreciation

Judgement Text

INCOME TAX APPELLATE TRIBUNAL, CIRCUIT BENCH, RANCHI BEFORE HON'BLE SHRI H.L. KARWA, PRESIDENT , AND HON'BLE SHRI B.R. BASKARAN, ACCOUNTANT M EMBER ITA NO . 112 /RAN/2014 A.Y 2009 - 10 M/S. ABHAY EENTERPRISES VS. A .C.I.T, CIRCLE - 3 , RANCHI ( ASSESSEE ) ( RESPONDENT ) ITA NO .34 /RAN/2014 A.Y 2009 - 10 A .C.I.T, C IRCLE - 3 , RANCHI VS. M/S. ABHAY EENTERPRISES PAN: AA CFM3340B ( DEPARTMENT ) ( ASSESSEE ) C.O NO. 22/RAN/14 [ITA NO.34/RAN/2014 A.Y 2009 - 10] M/S. ABHAY EENTERPRISES VS. A .C.I.T, CIRCLE - 3 , RANCHI ( CROSS OBJECTOR ) ( DEPARTMENT ) FOR THE A SSESSEE : S/ SH RI S.K PODDAR & M.K. CHOUDHARY, LD.ARS FOR THE RESPONDENT : SHRI CHOUDHARY ORAM, JCIT/LD.DR DATE OF HEARING : 2 7 - 11 - 2014 DATE OF PRONOUNCEMENT: 2 7 - 11 - 201 4 ORDER SHRI B.R. BASKARAN, ACCOUNTANT MEMBER : THE CROSS APPEALS FILED BY THE PARTIES AND CROSS OBJECTION FILED BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER DATED 29 - 11 - 2013 PASSED BY LD. CIT(A) , RANCHI (JHARKHAND) AND THEY RELATE TO THE ASSESSMENT YEAR 2009 - 10. SINCE IDENTICAL IS ISSUE INVOLVED IN THE CROSS THE APPEALS AND CROSS OBJECTION , THEY WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS COMMON OR DER FOR THE SAKE OF CONVENIENCE. 2 ITA NO S . 112,34 & CO NO.22 /RAN/14 M/S. ABHAY ENTERPRISES 2. THE REVENUE IS AGGRIEVED BY THE DECISION OF THE LD.CIT(A) IN ESTIMATING THE INCOME AT 6% OF CONTRACT RECEIPTS AS WELL AS GROSS HIRE CHARGES RECEIVED BY THE ASSESSEE. 3. THE ASSESSEE IS AGGRIEVED BY THE DECISION OF THE LD.CIT(A) IN DETERMINING THE INCOME AT 6% OF THE GROSS RECEIPTS. 4. IN THE CROSS OBJECTION THE ASSESSEE IS OPPOSING THE APPEAL FILED BY THE REVENUE. 5. THE FACTS RELATING TO THE ABOVE SAID ISSUE S ARE STATED IN BRIEF. THE ASSESSEE IS A CONTRACTO R AND ALSO CARRYING ON THE TRANSPORTATION BUSINESS. THE AS S E S SEE FILED ITS RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION DECLARING TOTAL INCOME OF RS. 12,26,148/ - . DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER NOTICED THAT THE ASS ESSEE DID NOT MAINTAIN REGULAR BOOKS OF ACCOUNT. THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE , WHO APPEARED BEFORE THE ASSESSING OFFICER ADMITTED THAT THE INCOME WAS COMPUTED ON THE BASIS OF BANK STATEMENT AND PAYMENT DETAILS FROM THE VARIOUS PARTIES . HENCE, T HE ASSESSING OFFICER PROCEEDED TO ESTIMATE THE INCOME OF THE ASSESSEE. HE NOTICED THAT THE ASSESSEE HAS DECLARED GROSS CONTRACT RECEIPTS AT RS. 4,80,14,981/ - . HE ESTIMATED THE INCOME AT 8% OF THE GROSS RECEIPTS AND DEDUCTED THERE FROM INTEREST AN D REMUNERATION OF THE PARTNERS AND ALSO DEPRECIATION . ACCORDINGLY, HE ESTIMATED THE INCOME FROM CONTRACT BUSINESS AT RS. 1 1,85,328/ - , TO WHICH HE ADDED INCOME FROM TRANSPORTATION AND HIRE CHARGES . 6. IN THE APPELLATE PROCEEDINGS, THE LD.CIT(A) ACCEPTED THE CONTENTION OF THE ASSESSEE THAT THE TRANSPORTATION AND HIRE CHARGES RECEIVED BY THE ASSESSEE WAS FORMING PART OF GROSS CONTRACT RECEIPTS. HE ALSO ACCEPTED THE CONTENTION OF THE ASSESSEE THAT ESTIMATION OF INCOME AT 8% BY THE ASSESSING OFFICER IS ON THE HIGHER SIDE. ACCORDINGLY, THE LD. CIT(A) DIRECTED THE ASSESSING OFFICER TO ESTIMATE THE INCOME AT 6% OF T HE GROSS RECEIPTS FROM THE CONTRACT WORK AS WELL AS 3 ITA NO S . 112,34 & CO NO.22 /RAN/14 M/S. ABHAY ENTERPRISES TRANSPORTATION WORK. AGGRIEVED, BOTH THE PARTIES HAVE FILED THESE APPEALS BEFORE US. 7. W E HEARD THE RIVAL CONTENTIONS AND CAREFULLY PERUSED THE RECORD. WE NOTICE THAT THE ASSESSING OFFICER DID NO T BRING ANY MATERIAL OR COMPARABLE CASES ON RECORD TO SHOW THE PROFIT RATE OF 8% ADOPTED BY THE ASSESSING OFFICER WAS A REASONABLE ONE. WE FURTHE R NOTICE THAT THE LD.CIT(A) HAD PLACED HIS RELIANCE ON THE DECISION RENDERED BY THE CO - ORDINATE BENCH [ITAT CIRCUIT BENCH, RANCHI ] IN THE CASE OF AKHILESH KUMAR, RANCHI VS. ITO, W 1(1), RANCHI (ITA NO. 227/RAN/2008 ) , WHEREIN THE TRIBUNAL HAD HELD THAT PROFIT RATE OF 6% WAS JUSTIFIED. ACCORDINGLY, T HE LD CIT(A) ESTIMATED THE PROFIT OF THE ASSESSEE AT 6% OF THE GROSS RECEIPTS OF RS. 5,12,10,215/ - , WHICH WORKED AT RS. 30,72,613/ - . SINCE THE ASSESSEE HAD DECLARED THE NET PROFIT BEFORE THE PAYMENT OF INTER EST AND REMUNERATION TO THE PARTNERS AT RS. 26,78,298/ - , THE LD.CIT(A) DIRECTED THE ASSESSING OFFICER TO RESTRICT THE ADDITION AT RS.3,94,000/ - MEANING THEREBY THE ADDITION TO THE TOTAL INCOME RETURNED BY THE ASSESSEE WAS DIRECTED TO BE MADE AT RS. 3,94,000 / - . 8. ON CONSIDERATION OF THE FACTS PREVAILING IN THE INSTANT CASE , WE ARE OF THE VIEW THAT THERE IS NO INFIRMITY IN THE ORDER OF THE LD.CIT(A) ON THIS ISSUE. ACCORDINGLY, WE DO NOT FIND ANY MERIT IN THE APPEALS AND CROSS OBJECT FILED BY BOTH THE PARTIES. 9 . IN THE RESULT, BOTH THE APPEALS AS WELL AS CROSS OBJECTION ARE DISMISSED. PRONOUNCED ACCORDINGLY ON 27 - 11 - 2014 SD/ - SD/ - [ H .L. KARWA ] [ B.R. BASKARAN ] PRESIDENT ACCOUNTANT MEMBER DT. 2 7 - 11 - 2014 PLACE : RANCHI PP, SR. PS 4 ITA NO S . 112,34 & CO NO.22 /RAN/14 M/S. ABHAY ENTERPRISES COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT : M/S. ABHAY ENTERPRISES, DALTONGANJ 2 THE RESPONDENT: A CIT ,C IR - 3 , RANCHI 3. .THE CIT, 4.THE CIT(A), 5.DR, ITAT CIRCUIT BENCH, RANCHI 6. GUARD FILE. TRUE COPY, BY ORDER, ASSTT. REGISTRAR 5 ITA NO S . 112,34 & CO NO.22 /RAN/14 M/S. ABHAY ENTERPRISES 1. DATE OF DICTATION ............. 2 7 - 11 - 2014 ....................... 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER ........................OTHER MEMBER ...... 28 . - 11 - 2014 ........................ 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P.S./P.S. ..................... 4. DATE ON WHICH THE FA IR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT.................................. 2 7 - 11 - 2014 ................................................... 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. P.S./P.S ................ 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK ....................................... 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ......................................... 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER .. ............................................................................................... 9. DATE OF DESPATCH OF THE ORDER ..............................................................